Small businesses, with fewer than 20 employees, account for around 97 per cent of all businesses in Australia. Homegrown entrepreneurs punch well about their weight when it comes to their economic impact. Across 2018-19, small business contributed over $400 bn to the Australian GDP, showing how innovation and bright ideas are critical to economic activity.
Building a business from scratch involves a lot of hard work and extreme dedication. In the early stages, every decision that a leader makes comes with a price-tag and could mean the difference between success and failure. It’s therefore important that business leaders set out to make choices that promote opportunities for long-term growth. Here are the top three investments successful entrepreneurs make to grow their business.
Choose the best tools for the job
Just as most businesses need essential services to operate effectively, prioritising digital tools is crucial to keep processes running smoothly, increase productivity, and encourage growth. A recent study by Frost & Sullivan and Oracle NetSuite which surveyed more than 500 entrepreneurs across Australia, New Zealand and six Asia-Pacific markets identified that over half of Aussie entrepreneurs regard their core business software as crucial to the success of their business.
As an example, businesses in the retail sector can streamline ecommerce operations by using cloud-based ERP to automate tasks like order management, inventory control and invoicing, leaving teams with more capacity to focus on delivering quality customer service. The same example is true for other industries where manual tasks and business complexity threaten to steal away valuable time.
Turning ideas into sales
In Australia, 33 per cent of entrepreneurs started their business to pursue an idea they were passionate about. While this passion can certainly keep the fires burning during late nights and long hours, ultimately, attracting customers is the key to business success. If customers don’t know about you – they can’t buy from you!
A survey of 500 US entrepreneurs saw respondents acknowledge they should spend much more on effective marketing in order to build product awareness to drive sales and improve the bottom line.
The brand is an extension of the leader and represents the development of their ideas and hard work. Clever marketing can result in customers also forming an emotional attachment to the brand and product. This subconscious effect can result in brand recognition, recommendations and, most importantly, customer loyalty and repeat business.
A further study by The Wise Marketer found that 56% of customers stay loyal to brands who “get them”. Once you have gained customer loyalty, half the battle is already won.
It pays to invest in your people
A recent report from LinkedIn found that 94 per cent of workers would stay at a company longer if they felt it invested in their careers. An IBM study also revealed that employees who do not feel they are developing or achieving their career goals in a company are 12 times more likely to consider leaving it. This can have a huge impact on a small business or start-ups, as replacing an employee can cost a business as much as 30-150 per cent of their annual salary.
When starting a business, leaders are in a great position to invest in their employees from day one by providing training opportunities, creating rewards and incentives, and even providing budget for team-building activities to make employees feel valued. A report found that a rise in workers’ happiness led to an increase in productivity. By putting employees first, leaders can ensure employees align with the goals and vision of the business.
Aussies have always been an ambitious lot, so it’s no surprise that small businesses are such a fundamental part of the local economic activity. Making the right investments, early on, could mean that what was initially just an idea could have the potential to become the next Aussie unicorn.
